Quorum shares crash after KKR says buyout unlikely

Shares of Brentwood, Tenn.-based Quorum Health lost more than half their value after private equity firm KKR said talks with the company are now focused on a reorganization, according to the Nashville Post.

In December, KKR said it was exploring leading a recapitalization that would restructure Quorum's debt load. In a Dec. 2 letter to Quorum's board of directors, KKR mentioned several terms of the potential transaction, including the possibility of taking Quorum private, "partly through a buy-out of the public shares held by minority holders at a price of $1.00 per share."

On March 10, KKR said a buyout is unlikely and talks are now focused on "a reorganization … in which no assurances can be given that shareholders of … common stock will receive any consideration," according to the Nashville Post.

Quorum responded to the update from KKR in a statement released March 11.

"The company, together with its financial and legal advisors, continues to engage in constructive discussions with KKR and other debt holders regarding a potential recapitalization or financial reorganization transaction," the statement reads. "The company's objective is to reach a consensual agreement that enables it to reduce its annual interest expense, enhance its operations and invest in future growth."

The update from KKR took a toll on Quorum's share price, according to the Nashville Post. The company's shares closed March 11 at 48 cents, down from nearly $1.10 the day prior. Shares closed March 12 at 45 cents and March 13 at 53 cents.

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Featured Whitepapers

Featured Webinars